Why the president's budget request matters

By FCW Staff

Mar 05, 2012

President Barack Obama’s fiscal 2013 budget proposal is generally viewed as dead on arrival. But his IT agenda? That remains to be seen.

In any given year, a president’s budget proposal serves as a starting point for negotiations in Congress and rarely resembles what ends up as law months later. In this case, congressional leaders said from the outset that the proposal was a non-starter and that they intended to pursue their own course toward creating a plan that addresses top spending priorities without raising the deficit or derailing economic recovery.

Nonetheless, the president’s budget document makes the case that his evolving IT agenda is essential to improving the efficiency of government operations and saving money down the road.

In all, the budget calls for spending $78.8 billion on IT, a 1.2 percent decrease from the 2012 request. Many of the highlighted IT projects apparently received support because of their potential to improve the efficiency of agency operations by modernizing and enhancing existing systems.

But the budget also pushes a number of ideas that are not just about saving money, and that is where the questions arise. Here is a look at some of the possible hot spots in the Obama administration’s agenda.

Data center consolidation: The cuts keep getting deeper

It has been nearly two years since the Obama administration launched its governmentwide effort to consolidate data centers, but that doesn’t mean agencies are clamoring to reach the finish line, according to some experts.

In 2010, federal agencies began work on the effort to close a minimum of 800 data centers by 2015 in hopes of radically cutting costs, increasing IT efficiencies and promoting green IT. For the most part, agencies have taken strides in the right direction.

Thomas Woteki, chief architect for strategy and solutions development at Acentia, said his firm had seen a significant commitment to data center consolidation in the federal community. The departments of State, Homeland Security and Agriculture have “active consolidation efforts well along the maturity curve,” he added.

However, not all agencies are keeping the same kind of pace, and the holdup is not necessarily rooted in a technical challenge, said Sudhir Verma, vice president of consulting services at Force 3. With program-based funding, agency CIOs can’t take a holistic approach to all the IT resources and allocate based on the need, he said. Instead, they are forced to distribute resources based on program requirements.

“It’s the traditional procurement model that doesn’t support full-scale data center consolidation,” Verma said. The Office of Management and Budget and the General Services Administration “are looking at new ways for procuring IT services and hardware. Hopefully, that will change the agency behavior from procuring IT in a stovepiped fashion based on program funding to more of a consolidated, resource requirement-driven procurement.”

A nudge to steer agencies in the right direction could soon come from the White House. On Feb. 17, Obama sent Congress the Reforming and Consolidating Government Act of 2012, which would reinstate the president’s power to reorganize the federal government. If granted that power, the president could also consolidate agencies and force them to adopt cloud services and reduce the number of data centers, Verma said.

Cybersecurity: You want to spend how much?

As the latest round of the budget showdown takes place on Capitol Hill, one area of spending is emerging as both high profile and uncertain: cybersecurity.

In February, some lawmakers vehemently called for increased attention to critical IT infrastructures, while others cautioned against making any hasty decisions. The budget request asks for funding for several specific programs at the Defense Department and other agencies, adding the administration’s voice to the debate.

But some experts doubt that the government is ready to make major advances, particularly given the price tag.

Obama proposed $650 million for research in cybersecurity, explosives detection and chemical/biological response systems at the Defense Advanced Research Projects Agency, plus $769 million to support the operations of the National Cyber Security Division at DHS. More security-related spending is sprinkled throughout the budget. But where is all that money going to come from?

With a focus on reducing costs, it’s unlikely that boosts to cybersecurity will come from new funds, said Lt. Gen. Christopher Miller, the Air Force’s deputy chief of staff for strategic plans and programs. “We made some tough choices [in the 2013 budget]. We can’t take cyber spending for granted. Another dollar for cyber will likely come from another critical area.”

Trey Hodgkins, senior vice president for national security and procurement policy at TechAmerica, agreed. "There’s a pretty clear picture that when there are calls for cyber activity to be undertaken, [Congress] is not going to be putting more money on the table,” he said. "They’re going to expect that they be done within the confines of the resources that are currently available."

Furthermore, the administration’s good intentions hinge on factors beyond its control. For instance, the budget highlights the importance of enhancing the cybersecurity workforce and assembling “a strong cadre of cybersecurity professionals to design, operate and research cyber technologies, enabling success against current and future threats.”

The obstacles are “the character of the workforce itself and particularly the ongoing problem we’re having in sustaining both the supply of and demand for eligible, competent science, technical, engineering and mathematics people,” said David Berteau, director of the International Security Program at the Center for Strategic and International Studies.

IT spending: Operations, not investments

If the Obama administration keeps its IT agenda on track — which, of course, entails winning a second term — future IT budgets are likely to look very different from years past.

That is because several key pieces of the IT strategy — cloud computing, intra-agency shared services and commodity buys — entail a shift in how money gets budgeted and spent. After launching efforts to better manage the government’s capital investments, most notably through the TechStat process, the administration is “encouraging a shift from a capital-intensive model to a more agile, operational focus,” the budget document states.

“Agile” is the operative word. When agencies pay for IT as a service rather than as a system, they have an easier time adjusting their spending to match their needs. That approach avoids the problem of spending millions to buy a system only to discover that changing requirements render it useless.

“This would allow them to focus more of their IT budgets on mission-based investments rather than the underlying infrastructure,” said Deniece Peterson, senior manager for federal industry analysis at Deltek.

That thinking might already be working in procurement. For example, GSA and the Defense Information Systems Agency recently worked together to award a new satellite communications contract that relies on commercially available services rather than building a program from scratch. The services are available to both defense and civilian customers.

Still, such innovations can run into trouble, particularly when it comes to interagency initiatives. Congress has made appropriations a vertical process by giving money to individual agencies, Hodgkins said, which makes it difficult for agencies to work on projects that cut across multiple organizations in a more horizontal fashion.